General Motors has agreed to pay a $900 million settlement and has agreed to admit to misleading the public about vehicle safety amid defective ignition switches.
According to an ABC News report, the criminal charges in this case included wire fraud and scheming to conceal information.
The company is also charged with concealing a potentially deadly safety defect from U.S. safety regulators, specifically the National Highway Traffic Safety Administration (NHTSA) from the spring of 2012 through February 2014.
GM Concealed Deadly Vehicle Defect
GM’s CEO, Mary Barra, apologized during a town hall meeting September 17 telling her employees: “People died in our cars.” She also told them that she had apologized to the families who lost loved ones and to those who were injured.
U.S. Attorney Preet Bharara said GM engineers knew before the defective ignition switch went into production in 2002 that it was prone to move out its “run” position into “off” or “accessory,” disabling the vehicle’s front airbags and exposing occupants to lethal injuries in the event of a crash.
Bharara said the automaker failed to disclose a deadly safety defect to the public and NHTSA. The government’s criminal investigation said the defective switches caused at least 124 deaths.
GM had set up a victims’ fund last year to compensate those who were injured or had lost a loved one due to defective vehicles including the Chevy Cobalt and HHR, Pontiac G4 and G5 and Saturn Ion and Sky vehicles.
In a separate announcement, the automaker also settled to resolve a shareholder class-action lawsuit filed in Michigan federal court.
The $575 million agreement covers about 1,380 personal injury and wrongful death claimants including more than half of the personal injury plaintiffs in lawsuits in multiple districts pending in New York federal court.
Justice for Victims
These are both landmark settlements for victims of the GM. The GM ignition defect cases are very close to our hearts here at the auto defect law firm of Bisnar Chase because our firm, in 2006, filed the first known lawsuit relating to ignition defects on behalf of the family of Shara Lynn Towne.
That crash occurred in 2004 when Towne’s Ion sedan jumped a curb and hit a utility pole. The car’s airbags failed to deploy.
There are 124 victims who have lost loved ones as a result of these defective ignition switches. While the automaker has admitted to misleading the public, there has been no explicit acknowledgement of criminal wrongdoing and individual criminal accountability.
We hope individual victims who have been catastrophically injured as a result of these defective autos still have recourse through the civil justice system and are able to seek and obtain fair compensation for their significant losses.